Clearwire’s Launch Party in Portland

Posted by
Sam Churchill
on
January 6th, 2009

Clearwire (or is it Clear now), today presented their Portland, Oregon, Mobile WiMAX system to the press and analysts. It was Clearwire’s first implementation of Mobile WiMAX in the United States. While Clearwire now provides pre-WiMAX broadband to some 400,000 subscribers in 46 markets, the earlier technology does not roam, nor can it be used in small handheld devices.

Clearwire’s Mobile WiMAX now provides multi-megabit speeds throughout a 700 square mile region around Portland, with a potential user population of nearly 1.7 million people.

Ben Wolff, CEO of Clearwire, which closed their 3.2B joint venture with Sprint, Comcast, Time-Warner Cable, Google and Intel, this November, demonstrated the technology using a video conference with Portland’s new mayor Sam Adams. Live cameras on Light Rail trains were also shown, while attendees could also ride the city’s Streetcar and special buses that demonstrated mobile broadband connectivity and seamless handoff between cell towers.

Wolff said WiMAX had three main advantages over cellular; (1) spectrum, (2) an all IP Network and (3) and open Internet model, allowing all manner of devices and applications to use the spectrum.

Almost half of all iPhone users prefer WiFi rather than cellular’s 3G network, said Wolf, with data traffic for mobile phones now comprising some 20% of revenues from cellular carriers — and growing fast.

Why Portland? Because it has a tech savy population, a large contingent of Intel engineers and it is convenient to their Kirkland, Washington, headquarters.

Sean Maloney, Intel’s VP of Marketing, explained Intel’s pioneering work with networking, including the development of Ethernet in the early 1980s, Wi-Fi development in 2000-2001, and the development of WiMAX standards in 2003 to today. Ron Resnick, President of the WiMAX Forum was also in attendance, but did not speak. We’ll post some video interviews from the show later. Below is a video from MocoNews.

Scott Richardson, Clearwire’s Chief Strategic Officer, proclaimed, “Portland is now the fastest unwired city in the West.” He showed live cameras aboard Portland’s Light Rail train to prove the point and announced that Clearwire was donating 25 WiMAX modems for city Police cars. The new mayor approved. “It will improve on our ability to provide services to the public”, said Sam Adams.

City employees from a variety of departments were also at the press show. Applications such as location tracking of dump trucks and other vehicles as well as the city’s electronic parking meters were also mentioned (unofficially).

The City of Portland has no skin in this game or legislative oversight. Clearwire, like other cellular operators, mounts their radios on cell towers, not on lampposts or public rights of way, and negotiates with tower or building owners.

Ben Wolff said rolling out broadband wireless service is not a piece of cake that can be turned on in a few months (although the radios can be installed in less than a day). “It takes 1-2 years to launch a market,” said Wolff. Zoning requirements involve lots of municipalities. Even adding one radio to an existing tower requires a lengthy permitting process, said Wolff.

I asked Wolff how the cost of wiring a city compared with WiFi and Cellular. Cost of the backhaul and all the WiFi antennas makes it 3-4 times more expensive than WiMAX, said Wolff, with cellular infrastructure costing 10 times more than WiMAX. “Our network was designed for data,” he said. Clearwire is also adding extra capacity from day one, making it easier to expand.

Wolff said that Clearwire would not be able to announce which cities were next for either Sprint or Clearwire until after the Clearwire board makes a decision in the next few weeks. WiMax watcher ThinkEquity is predicting that Clearwire will launch a total of nine markets this year, suggesting “a slower revenue ramp and lower levels of cash burn than had the original plans gone forward,” reports Unstrung.

Sprint has little choice but to press forward. Under the rules of the merger between Sprint and Nextel, by 2009 Sprint must have a service in the 2.5-GHz band available to at least 15 million people, with another 15 million by 2011. Failure risks forfeiture of the spectrum it gained from Nextel.

Residential Clear service costs from $20 to $40 per month based on bandwidth: from 768 Kbps to 6 Mbps (unlimited) while mobile service costs from $30 to $50 based on bandwidth limits of 200 MB, 2 GB, and unlimited at rates up to 4 Mbps/384 Kbps. Fixed business plans are $55 (4Mbps/1Mbps) or $75 (6Mbps/1Mbps) per month; while mobile starts at $25 per month per device for 4Mbps/384Kbps with a shared pool of bandwidth.

Wolff expressed confidence that the WiMAX system would catch on, eventually grabbing a 25% share of the market. He also expected users to soon use 2-3 times the data capacity they do now.

Clearwire will hold grand opening events at its three Portland retail stores from 9 a.m. to noon on Saturday, Jan.10th. The stores are located at: 15th and Broadway, 92nd and Sunnyside (Clackamas Promenade), and Burnside and 23rd Place (Uptown Shopping Center). Many area Malls also have Clearwire Kiosks.

The marketing is now kicking into high gear, both in Baltimore, Maryland (the first Mobile WiMAX city in the United States) and Portland, Oregon (the second). Whether the poor economy will help or hurt the nascent wireless service is unknown.